Check Out This Information On Credit Card Terms

Knowing the terms of your credit card agreement will assist you in comparing cards, knowing when you should change to a new card, and help you to save money by working the system. Therefore, let us start by listing a few key terms used in credit card agreements and explain what they mean:

Pre-approved – You have probably received an offer in the mail stating that you have been “preapproved” for a credit card. This is a misleading, common, practice of credit card companies, as you have not been pre-approved for anything. Mostly pre-approved means you have met some initial guidelines pertaining to your creditworthiness. To receive a pre-approved credit card notice does not guarantee you will be approved for the card if you choose to apply for it.

Annual Fee – Simply put, many credit cards have a yearly membership fee attached to their usage. Usually, the charge ranges from approximately $25 to $75, but there are premium cards which charge as much as a few hundred dollars.

Transaction Fee - If you are going to use your credit card for transactions other than purchases, such as balance transfers and cash advances, credit card issuers usually charge a transaction fee. The card issuers will sometimes waive these fees for new cardholders as part of an introductory offer. The transaction fee is typically calculated as a percentage of the transaction amount. There are card issuers who maximize the fee at a certain dollar level; however those card issuers are rapidly disappearing.

Grace Period - If a credit card has a grace period of 21 days, it means card interest will not begin accruing for 3 weeks, as long as you paid your balance in full the previous month. Using a credit card grace period to your advantage will let you avoid paying finance charges by paying your balance in full before the monthly due date. If the card has no grace period, interest will begin accruing the day you transact with the card. Many consumers use the grace period to get out of paying finance charges on their purchases while maintaining the convenience of using a credit card instead of cash.

This is not all the information available on credit card agreements, at best it is an introduction to credit card legalese. Hopefully it is of value to you.

Art Taylor has been a successful internet marketer for 10 years. He publishes articles about credit cards and other internet marketplace products and services. To gather more information or apply for credit cards visit his website at: ecreditcardworld.info Ecreditcardworld